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Buying Life Insurance in Your 60s
Finding the lowest life insurance rates by age requires choices. We work with dozens of top rated life insurance carriers. Our goal is to align each client with the right company, tailored to the unique health and lifestyle of that specific client. No two companies or clients are the same. This is how we find the lowest priced life insurance for clients 60 and older.
Buying life insurance 60 and over.
The focus of this article is to provide those who are in their 60’s with the tools they’ll need to procure the best life insurance coverage money can buy to protect those whom they love when that inevitable day occurs. At TermLife2Go, we review the top rated best life insurance companies in the United States and the best no medical exam life insurance companies. We also specialize in the top final expense insurance companies.
As someone in their 60s, you might also be interested in how life insurance can maximize an estate or simply trying to provide for your family's basic needs.
And if you are still relatively healthy, a million dollar life insurance may still be available. However, the time to buy life insurance in your 60s is NOW!
The key to finding the best rates on life insurance in your 60s is to understand what carriers are looking for. You should be aware of the companies offering the best life insurance for seniors, because if we had to list the top factors that affect life insurance premiums the number one factor would be age. And unfortunately, the price for your life insurance age 60 plus is going to increase dramatically from year to year.
In fact, age plays such an important role when it comes to buying life insurance that even a few months one way or another could mean the difference between being able to buy the coverage you need and buying the coverage you can afford.
On average during your 30’s the average cost of one’s life insurance will increase about 2% per year until they reach their late 30’s. Meaning that if you start thinking about buying life insurance at age 30 and don’t purchase a policy a policy until say, age 32, the end cost to you will be a policy that averages about 4% more than it would have had you purchased the policy immediately.
Now let’s consider the same scenario for someone buying life insurance 60 and older. Right now a $250,000 policy for someone in excellent heath that is 60 years of age will run right around $112.00 a month. For a 62 year old that same policy, with the same insurance carrier will cost approximately $145.00. That’s a 23% rate increase for those in their 60’s in just two short years. So you can see how just waiting a few months can really be very expensive.
Did you know? Life insurance age versus actual age:
Most life insurance companies will use something called “insurance age” to determine what “age” you should be considered when applying for life insurance. An “insurance age” is determined by looking at which birthday you are closest too at the time you’re approved for the life insurance that you’re applying for.
So if you’re birthday is two months from now, most insurance companies are already going to consider you 1 year older than you actually are, and you will be priced accordingly.
For this reason alone, it pays to work with an insurance agency who will first discuss with you the significance of the “insurance age dilemma” and see if there is any way around it. There are also few different insurance companies that use ones “true age” in pricing their policies (unfortunately, the vast majority of insurance companies will use the “insurance age” pricing standard).
So you can see that for every year that you wait to purchase your life insurance in your 60's, regardless of your health, you’re going to be paying more!
2. You're Not Getting Any Younger!
Now they say that 60 is the new 40, and for many of us it’s true, but let’s also be realistic. Most 40 year olds aren’t necessarily going to be worried about the rising cost of their AARP membership or whether or not the medicare supplement plan is going to cover their prescription medication needs!
Which means that even if you don’t have any issues with let's say:
- High blood pressure,
- High cholesterol,
- Elevated blood sugars,
- Etc, etc…
Your agent who knows that once you are looking for life insurance at age 60 and over, life insurance companies are going to be much more strict when it comes to underwriting your application.
For example, an applicant applying for life insurance over the age of 60 will:
- Most likely have his/her medical records ordered from their primary care physician automatically by the underwriting insurance company.
- Most likely be required to have had a full physical preformed by their primary care physician within the past two years to be eligible for a preferred life insurance rate class.
- And may encounter more difficulty being approved for larger life insurance death benefit amounts.
In addition, common conditions such as High blood pressure, High cholesterol, and Elevated blood sugars, do begin to be taken much more seriously by some life insurance companies now that you’re in your 60’s.
The one exception is for clients 60 yrs and older looking for life insurance with diabetes.The older you are diagnosed with diabetes the better rate class you can get with the disease.
3. Knowledge is Everything!
For many people, it’s not until they reach their 60’s that they really begin to understand and value the importance life insurance can play in the financial future of one’s family. For business owners, this can be particularly true, which is why you should consider business succession planning with a buy sell or key person insurance.
By the time one is 60, they’ll usually have a pretty good idea of how much life insurance they’ll need in order to protect their family. For example, someone looking for life insurance age 60+ will probably already realize the following:
- Retirement won’t necessarily seem so far away, which means that things like pensions, 401K’s, and Social Security benefits will generally be pretty well understood and accounted for when it comes time to considering how much insurance is needed.
- Mortgages could be maturing or finally being paid off, so applicants buying life insurance in their 60’s will generally have a better idea of exactly how much they need to cover any housing expenses.
- In a perfect world, the kids will be off on their own, doing their own thing, which should lessen the need for a lot of insurance.
- And one's overall debt should be well understood.
Which is why we usually find that most clients looking for life insurance in their 60's know exactly how much insurance they need and want, they’re just having a difficult time finding it for the right price! Which leads us to our next topic.
4. Choices, choices, and more choices!
When it comes time to purchasing life insurance age 60 plus it's nice to know that you’ll have options. In fact what many people don’t realize is that as you age, many of the very popular term life insurance options, specifically no medical exam term life insurance, will disappear. It is for this reason alone why it’s important to not only to have an idea of how much insurance you need today, but also what you’ll need in 10 or 20 years from today.
Another thing to consider is that age is also a niche for life insurance companies. That means that clients shopping for life insurance age 60+ need to consider the most age 60+ friendly carriers available. This is key to finding the best company at the best price.
The real answer to this question will always be, it depends. The factors that determine which company you should choose for life insurance in your 60's include:
- How much life insurance coverage are you looking for?
- What type of life insurance policy do you want?
- What’s your height and weight?
- Do you use ANY tobacco or nicotine products?
- Are you taking any prescription medications?
- Do you have any pre-existing conditions?
- Do you have a family history of cancer, heart attack or stroke?
- The good news is that for many carriers that we represent, life insurance applicants over the age of 60 need not worry about family history.
- Do you participate in any dangerous hobbies or travel to any dangerous locations?
- Do you have a bankruptcy on your record?
- Have you ever been convicted of a felony or multiple misdemeanors?
- Etc, etc…
Chances are, if you find yourself speaking with a life insurance agent that doesn’t ask you these types of questions, you’re either:
- Not going to get an accurate quote. Which unfortunately happens all the time especially if the agent that you’re working with has certain sales quotas he or she must meet each month… AKA, call center agents.
- Or, it might also be the case that your agent is what is call a “captive agent”---meaning that they can only write life insurance policies with one or two companies. If this is the case, knowing all the answers to these questions up front may not make a big difference because they only have one or two options to begin with!
5. Conversion Option: What Does that Mean?
Another great thing about buying life insurance in your 60's, prior to being diagnosed with any serious medical conditions is the “Conversion Option!”
Now while not something that most people consider when initially looking for a life insurance policy for their family, purchasing a life insurance policy with a conversion option should be something that everyone should take seriously.
Fortunately, nearly every life insurance policy that we offer here at TermLife2Go has an option to convert a term life insurance policy to a permanent policy before the policy ends or by age 70. So if you choose to go the cheaper route and buy term life insurance, you can always convert the policy to a permanent policy and keep the coverage for the rest of your life. However, you convert the insurance at the rate class you originally qualified at.
What that means is that if you are 70 years old and have cancer but originally qualified at a preferred plus rate class, you will be able to convert your policy at a preferred plus rate class despite the fact that you have cancer. That means you are essentially buying life insurance now as a protection that you can choose to utilize down the road if necessary. At the same time you are paying lower premiums for term than you would for whole life insurance. That is a great way to save on life insurance in your 60s!
6. Accelerated Death Benefit
If you are in your 60's and looking for life insurance then you have probably considered your own mortality once or twice. When you contemplate your time left here on earth you probably have thought about what you would do if you came down with a life threatening disease, such as cancer or heart disease. And you probably wondered how you would provide for your family and cover medical bills, debt, etc... if you could no longer work due to a serious illness. Enter living benefits such as chronic and terminal illness riders.
With an accelerated death benefit or terminal illness rider, you can take up to 50% of the death benefit in advance. The advantage of doing so would be to provide for medical expenses, in home care, hospice, bills, debt, or to simply find a cruise around the world---your choice! But most importantly, it would free you up from the worry about taxing your loved ones due to the high cost of fighting a terminal illness. And the good news is that the majority of companies include a terminal illness rider at no additional cost!